What follows is a transcript of Panorama: The NHS Blame Game, broadcast on Sunday 26 March 2006 at 2215 BST on BBC One.
This transcript is based on a recording and because of the possibility of miss-hearing and the difficulty, in some cases of identifying individual speakers, the BBC cannot vouch for its accuracy.
JOHN WARE: More and more billions of our taxes are going on the NHS.
The increases have been bigger than at any time in history.
So why is the NHS sinking deeper and deeper into debt?
Where have all our billions gone? And who is to blame: hospital managers, or ministers?
WARE: I'm told you're called Patsy in your Department. Patsy for having to take the responsibility for all the miscalculations of your predecessors. It's a serious point. I'm not being facetious.
PATRICIA HEWITT MP: I feel incredibly lucky to be Health Secretary. I can't think of more wonderful people and a more wonderful service than anybody could work with. And I also feel very lucky to be building upon the achievements of John Reid and Alan Milburn who put in place this investment and reform programme."
NEWS CLIP: First tonight, another financial crisis at another hospital..
WARE: Last week an old familiar sound stirred across the country..
NEWS CLIP: Fighting NHS cuts..
WARE: As if awakened from a long slumber.
NEWS CLIP: What future for Stamford's hospital. The MP for Northampton has had a meeting to day with the Health secretary to discuss the financial crisis at the local hospital
WARE: It's the same story in Surrey, perhaps the wealthiest part of Britain.
The health Trust it shares with Sussex is also one of the deepest in debt
Surrey and Sussex's debt now stands at £60m.
In this climate, only the fittest survive.
This special unit for the brain injured, built only 18 years ago, is now up for sale.
The NHS is still paying therapists while they stay a home.
CAROL CARR, PHYSIOTHERAPIST: We know we can improve someone's quality of life following neurological injury because it's not cost effective and it isn't financially viable in their eyes but that will be the l most important thing and that is a tragedy in my view.
WARE: When the accounts close this week for the whole of the National Health Service, they will show a record debt in England of around £3/4b of a billion pounds.
HEWITT: "There's a small number of organisations and a relatively small number of areas where the financial problems are concentrated. These are where you've got the big deficits, they're areas like Surrey and Sussex for instance which has been over funded compared with the rest of the country for quite some years, and have been overspending. "
WARE: In the NHS blame game, ministers say they've dealt managers a good hand with billions and billions of extra money.
In return ministers want managers to raise their game.
PRIME MINISTER TONY BLAIR: You challenged us to come up with the money. We have done so. We rose to your challenge. Now I ask you to rise to ours. It will take tough, often painful decisions about change in order to make progress."
WARE: In the countdown to the 2001 election, Surrey and Sussex Trust did make a tough choice.
They wanted to move some units in Crawley hospital to a better equipped one nine miles away.
Beginning with maternity.
PROTESTERS: What do we want
When do we want it
WARE: People took to the streets.
But some Surrey and Sussex Trust non executive directors were prepared to face down the protesters.
ROBIN EVE: If there's one thing the Surrey and Sussex Trust could do to put its finances right it will be to close Crawley Hospital. Now. we were always told we couldn't go there, we did look at it, we'd be failing in our duty if we didn't look at the possibility of closing it. Clearly to have two hospitals when you only need one is barmy.
WARE: But an election was looming - and Crawley was not a safe Labour seat.
It was the NHS's legendary tough guy, Alan Milburn - not the Trust - who flinched at the first whiff of grapeshot.
The then Health Secretary ordered no more units in Crawley to close pending an inquiry.
EVE: Of course that cost us money. a lot of money because. several million pounds because services that should have been consolidated and much more cost effective we had to keep the duplication going.
WARE: Eighteen months passed before the Trust was allowed to do what it had wanted to do before the election: move units to Redhill
Robin Eve believes had ministers practiced what they preached, the Trust would not now be so deeply in debt.
And yet it was he and his fellow directors who have taken all the blame.
EVE: I was called in with my colleagues and told that we non-executives. having been party to a major deficit, were required to resign, which I refused to. I wrote at length to the Appointments Commission, explained why I wasn't going to resign and I was in due course dismissed, my contract was terminated.
WARE: What reason did they give?
EVE: Failure to take.. you're not going to believe this.. failure to take the tough decisions that Mr Blair says we all should be taking.
BBC TEN O'CLOCK NEWS: Good evening ...hospital...announced more job losses
WARE: In the past month, hospital trusts have announced the loss of up to 3000 jobs.
WARE: Is there any part of the deficit that the Department of Health takes responsibility for?
HEWITT: We all take responsibility for this. This is not about blaming anybody. It's not about blaming managers¿
WARE: But you have, you've singled out fiver or six percent of the managers.
HEWITT: I haven't¿
WARE: The blame game started with your office.
HEWITT: Well with great respect, what I was pointing out was that we have the biggest financial problems in a small number of organisations. the problem as I've been describing has been one of not yet getting best practice right across the NHS. It's been one of a culture that's grown up over 60 years where overspending areas were being bailed out and expected to go on being bailed out by other parts of the NHS at the expense of their patients
WARE: Overspending? That cuts two ways.
It's rare for NHS managers to talk candidly these days so fearful of the Department of Health are most of them for talking out of turn.
But Bedford Hospital did agree to share the details of their deficit which has built up over the last two years to £11.5m.
HELEN NELLIS: Traditionally the hospital, our hospital has had an open door for everybody; it has absorbed all the patients and all the costs of the people who continue to come to our hospital because we are here and because we have a good reputation
WARE: Some of Bedford's debt is down to what ministers told them to spend - and over which they had no control.
For example, what they now have to pay consultants.
WARE: David Skipper has been a consultant surgeon for eleven years.
SKIPPER: I think there has been in the popular minds that the consultant was the great man at the top who swanned in and did a little then went off to the golf course, which was perhaps a convenient - a caricature almost to use - when trying to deal with the medical profession I think there's been a .deal with the medical profession
WARE: Alan Milburn gambled that he could change this.
He thought he could get a lot more out of doctors by paying them a lot more.
ALAN MILBURN: It is a something for something deal. It offers more pay for NHS consultants so that more NHS patients benefit from more of the precious time and skills of these senior doctors
WARE: The "Something" that the consultants got was a huge pay rise - about £20,000.
So what about the "Something" that the taxpayers got back?
Like most consultants David Skipper was giving a lot of his time for free.
DAVID SKIPPER, SURGEON: I was contracted for 33.5 hours per week. I suppose I was working between 50 and 65 hours a week in the NHS. I'm now on
WARE: Now the government wanted to contract him for 40 hours - but pay him a lot more.
SKIPPER: I'm still working over 50 and up to 60 hours a week. And so what I do has not changed. And so the taxpayer is getting no more out of David Skipper because he doesn't have more to give.
WARE: And they'd get even less out of him if he stuck to the new minimum hours to collect his pay
SKIPPER: When I looked at the hours I was doing and looked at what I would have to do to my work pattern in order to fall into 40 hours, I had to halve my clinical commitment. And this was clearly not acceptable. It wasn't the job of a consultant surgeon- I mean it was half the job of a consultant surgeon.
SKIPPER: It would have had a tremendous impact on patients - I mean half of what I'm doing at the moment would inevitably have meant waiting targets been breached.
WARD: The Department of Health also underestimated what this "something" for "nothing" deal would cost
NELLIS: The consultant contracts cost us around a million more than was was accounted for, in terms of the money that the hospital received..
WARD: That's a third of Bedford's debt this year.
Nationwide the pay deal has added £90m to hospital costs.
HEWITT: It is very difficult to model and predict precisely to within.. you know.. you're complaining about less than half a percent on one particular pay deal. It is very difficult to¿
WARE: Well that's the deficit for many of these Trusts that you're complaining about.
HEWITT: Exactly so. And we...
WARE: I mean I'm just saying you're not setting much of an example, that's the point.
HEWITT: We have to get the service as a whole into financial balance and we will do that over the next 12 months.
WARE: The Department of Health also underestimated what this "something" for ¿something¿ deal would cost
NELLIS: we don't think of ourselves as bad apples...we would argue that we're a very good hospital and we know exactly what we're here for and that's to deliver high quality, but we also know that we have to do that within budget
WARE:Hospitals also complain that the Department has dealt them an unfair hand with some of their key targets.
Waiting times have been reduced significantly.
Cancer and heart patients are also seen much more quickly - and their treatment has improved.
But for hospitals there's a catch.
SKIPPER: We were pressurised greatly on these performance targets up to and including april 2005 - then all of us a sudden - nobody said well done you've met your target but you've overspent - it was just "you've overspent"
WARE: And that became Bedford hospital's problem - not the Department of Health's.
NELLIS: One of the reasons why I think we have a deficit at this hospital relates to an assumption that we would be paid for the work that we did in order to meet the waiting list targets
WARE: She assumed wrong.
Many more patients arrived than Bedford had been allocated money for - both as planned admissions and through A & E.
The problem is that demand for health care is insatiable.
So when the supply is a fixed amount of money - as it is in the NHS - success through meeting extra demand can breed failure.
At least when it comes to balancing the books.
WARE: It's not surprising, is it, that some hospitals who have had to treat more patients than they've been paid for are in debt.
HEWITT: Some of the problems that you're describing are problems not just for the hospital, they're problems for the whole health community, and we know from for instance places like Dudley that where you've got a hospital, primary care trust, the GPs and the community nurses all working together actually you can radically reduce the number of emergency admissions if you do it by looking after the patients much better in the community.
WARE: Maybe. But according to health economists whose advise the Department often seeks, the problem we've outlined in Bedford has spread well beyond the 5% or 6% of Trusts - the bad apples that ministers blame for much of the NHS' record debt.
PROF. JOHN APPLEBY: My feeling is that there's. there's more on the sort of systemic side in terms of these. the origins of these deficits than there is in terms of simply blaming a few bad apples in the barrel, in the NHS barrel.
WARE: If this scale of the problem cannot be attributed to a few incompetent managers, as the Secretary of State seems to be suggesting, who is to blame?
APPLEBY: Well if I'm really put on the spot to point the finger, I think I'd have to point the finger at the Department of Health.
They're the ones, ultimately responsible for two crucial things. One is setting the financial sort of cost pressure environment by negotiating pay rises and so on, they're also the ones responsible for setting, on the other side of the equation, the demands on the NHS, the outputs it wants, the targets it sets and so on, and if you take those two things together, that's-. it seems to me that's the origin of the pressure for the deficit.
WARE: On pay there¿s been one more bit of restructuring - and it¿s the biggest miscalculation of them all.
The then health secretary John Reid gave GPs bumper pay rises;
£100,000 a year is now not unusual, making GPs the highest paid in Europe.
ALAN MAYNARD: The grossest error that the government has perpetrated has been the doctors' contracts, a really sad problem.
WARE: Alan Maynard is a health economist. And he's Chairman of a hospital Trust so he knows how the health service works on the ground.
MAYNARD: When John Reid was Secretary of State he signed off on those, but he would not have signed off unless he'd been told by No.10 Downing Street. So No.10 Downing Street and the Party clearly wanted a settlement before the election in 2005.. but what it did was squander NHS resources and give the taxpayer no quid pro quo..
WARE: The quid pro quo was that hospitals would be relieved of pressure by GPs treating more patients in the community.
MAYNARD: The GPs have been given an additional amount of money to put in care for chronic diseases and in many cases they were already providing it. They've been given a 20% pay increase for doing what they might have been doing anyway, or for doing what they should have been doing anyway.
WARE:The GP's pay rise is based on bonuses for treating chronic disease like diabetes.
GPs have qualified for £300m more in bonuses than the Department of Health forecast.
Which might help explain why its not just hospitals who are in debt, but also Primary Care Trusts who pay GPs.
WARE: How much more has the doctor's deal in total cost than you estimated it was going to cost?
HEWITT: Well all the pay reforms have cost us a bit more and I don't, I'm afraid, have the numbers in my head, but they've cost us a bit more than was budgeted before although¿.
WARE: It's a bit more than a bit, isn't it?
HEWITT: Well all numbers in the context of the NHS are big if you look at proportions they're relatively small, but the pay reforms which are hugely important to getting the improvements we want in the NHS have cost us somewhat more than we budgeted for. It is also..
WARE: Let's focus on this 'somewhat' bit.
HEWITT: Well let me just make¿
WARE: Hang on, I want to know what this 'somewhat' bit is.
HEWITT: Well I'm afraid I simply haven't got those figures in my head, forgive me for that, no doubt you will put them into¿
WARE: Well I am, yes indeed, I'm going to suggest it's at least half a billion and maybe as much as a billion.
HEWITT: Again I don't begin to recognise those figures. We put over a billion pounds.. ¿.
WARE: This is figure which presumably you wont dispute, this is from your own officials select committee December, just GPs alone, never mind the just the GPs alone has cost the taxpayer 300 million more than the original forecast. Doesn't say much for your departmental financial forecasting, does it.
HEWITT: Well that is less than half of 1% of the total budget and the GP contracts¿
WARE: But when you add all the other things it climbs up.
HEWITT: Of course. The new GP contract is performance related, and the reason why the GPs are being paid more than we or the BMA expected when we agreed the deal is that they're doing considerably more than we expected or indeed the BMA expected¿which means we're getting much better care in the community, much more preventative medicine and a larger, I mean thousands of people's lives saved from heart disease."
WARE: The restructuring of GP pay has had another costly knock on effect.
This GP's "Out of Hours" service in London covers nights and weekends.
GPs are no longer required to provide an "Out of Hours" service, though if they opt out, they take a pay cut.
However, they can offer back their services - at a much higher rate.
DR TIM LADBROOKE: Costs have risen in the case of our organisation from £3 a patient to just under £5 a patient, and our costs are probably one of the cheapest in the country. There are out of hours organisations around the country that are charging twice and I think almost - in certain cases almost 3 times as much as that.
WARE: The "Out of Hours" contract is so lucrative- some doctors are prepared to commute long distances.
FOLKE HESS, GP: I can earn roughly £5,000 a week which is more than I can make in a month in Germany. I came to London because I felt this is the best organised place I've seen. I've seen lots of places, but this is working here very effectively and also they're very welcoming to foreigners. I brought another six doctors from my home country , Germany to the ,UK to this place
CALL CENTRE: "Hello NHS Direct¿you're through¿"
WARE: NHS Direct was also designed to relieve pressure off GPs surgeries and A&E.
It was an eye-catching initiative from number 10 and allows patients to get instant medical advice.
LADBROOKE: The government, at least up to relatively recently, had hoped that NHS Direct would take all out of hours calls initially, triage them and only pass on those calls to doctors that needed to be seen. The hope I think was that it would save money. What we've learnt from our work together with NHS Direct over the last 4 of 5 years is that if every call goes through NHS Direct, 70% get passed back to us, and so Primary Care Trusts are finding themselves paying both the NHS Direct to give advice and then for us to give advice.
WARE: Many patients who call Out of Hours services will have already phoned NHS Direct- or "NHS Re-direct" as some ambulance crews call it because it often duplicates time and money.
NHS DIRECT CALL CENTRE: "If the symptoms should worsen in any way or any new symptoms should develop, call us back or contact your GP practice¿"
WARE: This year ,NHS Direct cost £180m .
There's been little evaluation of the benefit to patients from having all these different access points to the NHS which often duplicate each other.
MAYNARD: "I think our problem in the National Health Service at the moment is too many policies, all of them fragmented, no coherent approach to quality¿ to policy, and I think that comes out of No.10. They've been doing a wheeze a week. they're telling you to do new things and they punish you if you don't do it.."
WARE: All these "wheezes" and the new pay deal were designed to reduce the pressure on hard pressed hospitals.
The NHS is now hovering up nearly a quarter of billion pounds every day of every year.
APPLEBY: "for the NHS now to be reporting one of the biggest deficits it's ever seen in its history after a period of one of the biggest inputs of money in its history, it simply doesn't look good, and the question I guess we ask is what have we got for that money, apart from a big deficit what else have we got? And that's actually quite a difficult question to answer. It's not immediately obvious what sort of benefit we have got."
WARE: And that's because a staggering 87% of this year's extra billions has been eaten up by the huge cost of pay rises and other fixed costs.
APPLEBY: "When you take all that into account, what you're left with, or what hospitals in a sense are left with, is a fairly small fraction, certainly not the 7% real increase. They're left with maybe between 1 and 1½ to perhaps 2% real increase, so that's the money ¿to pay for extra operations, money to pay for restructuring of the health services, money to pay for extra drugs and so on."
WARE: Of the £3.6bn cash increase for England this year, just £475m has been left for all those things.
Had the Department of Health's forecast of costs been accurate, there would have been at least double that sum.
Nonetheless more people are being treated.
Which is what you'd expect from the 100,000 new NHS jobs the government has created.
But, given that staff numbers have risen so dramatically, are proportionately more patients being treated?
As Director of the NHS's financial reforms, Bob Dredge was at the heart of all these changes and at the highest level. He gives the government high marks for initiative - but not for value for money.
BOB DREDGE: In terms of recognised international ways of measuring health care productivity, we are at best stagnant, and probably a little bit below that.
WARE: Would you have expected the health service to be delivering more for patients than it is given these quite phenomenal increases over the last few years?
DREDGE: I would have expected and hoped it would have done, yes?
It's a hard thing to say, but probably were I running the show, I wouldn't have been as generous with pay, I'd have been more robust or more rigorous on output and productivity. "
APPLEBY: There's a psychology that there's lots of money around to dish out and maybe that has influenced how tough the negotiators were, and also, within the Department of Health there's feeling that there's a lot of money around. They've set targets for reducing waiting times. The trouble is, I think everybody's been thinking about the same pot of money. And, now we're facing a bit of a crunch time.
WARE: Of the £3.6bn cash increase for England this year, just £475m has been left for all those things.
Had the Department of Health¿s forecast of pay and other costs been accurate, there would have been significantly more.
MAYNARD: "¿you're getting this wave after wave of new policies and no one is thinking through whether they interact and how they interlock, and they've created an enormous amount of confusion from the Centre because they've had no coordinated integrated vision of where they're taking the NHS.
WARE:The NHS, as the official jargon goes, has been on a "long policy journey."
And sometimes ministers seem to have ended up where they started - having spent hundreds of millions en route.
APPLEBY: We're now at a position where in a sense Labour have recreated the internal market that the Conservatives tried to introduce in the early 90s
WARE: Take the GP service.
When Labour came to power, some GPs controlled their own budgets and could offer patients a choice of where to be treated.
Mr Blair abolished that.
Now Patricia Hewitt is re-creating this aspect of the internal market.
APPLEBY: It's back and we have it with extra added bite if you like. Patients can move round the system, and if they choose a different hospital they drag money almost literally with them to that hospital. So there are some really tough financial incentives now in this market, and we wait to see how that pans out.
WARE:How are hospitals coping with the NHS's permanent revolution?
In Bedford, not only does the hospital have to meet the Department's waiting list targets.
No longer can hospital bosses use some of the time honoured fixes and fudges to balance the books.
NELLIS: In the past, there've been a series of measures which organisations in the NHS have used towards the end of the financial year to move monies around to enable organisations that have struggled to achieve balance¿.and that again was one of the reasons why I think we have a deficit at this hospital.
WARE: These fixes and fudges have been stopped by a very tough new market orientated accounting system
But the penalty it imposes on a hospital in the red is now even tougher than it would be in the private sector.
The hospital loses twice: once by repaying the deficit; twice by having the same amount deducted from the following year's funding.
DREDGE: It probably is unfair, and it's.. I think an unintended consequence of introducing into...across the NHS, the accounting system , which is used across the rest of government¿, and that's what people are calling the double whammy.
WARE: This double whammy - a double penalty for going into debt - is a real threat to the recovery plans of hospitals like Bedford who were well on their way back into the black.
Bedford says it will take them eight years to wipe off their debt, as opposed to two.
WARE: In some cases hospitals are running a deficit, are hitting what they call a double whammy, they lose not only they have to pay back the debt that they're in but that same equivalent amount gets knocked off their budget from the following year. That doesn't seem to be very fair.
HEWITT: Clearly it causes a problem for hospitals or other organisations that have built up a deficit in one year and then find, just as you or I would be if we had a deficit in our own personal finances, that if you like the bank manager is expecting to see that problem dealt with in the following year. But I think that there are¿
WARE: the bank manager would just expect me to pay it back, he wouldn't say well you know.. when your next salary check comes in, I'm also going to knock off that amount, I'm going to take it twice.
HEWITT: A sensible bank manager would say you need to be paying back the extra spending.. the excess spending from the previous year and not running up the same excess spending this year.
WARE:You're not going to reform the double whammy problem so to speak?
HEWITT: I think there are some real issues about the financial management framework and the legal framework within which the NHS operates. I've asked Sir Michael Lyons and the Audit Commissioner and I'm glad to say they've agreed to have a look at this with us and come to us with their recommendations. "
WARE: But even without this punitive double whammy, the scale of debt may extend well beyond the quarter of Trusts currently reporting a deficit.
Some now claiming to be in balance are banking on making savings they may not realise.
Others would be reporting a deficit - but for financial support from other parts of the health service.
APPLEBY: ""in my view it's not a few rotten apples in the barrel ¿.."
We don't know the exact figure, but we could be talking up to 40% or perhaps more of NHS trusts with an underlying financial problem.."
HEWIT: I have to say I don't recognise that figure and again we have to remember that every area and every organisation of the NHS is getting next financial year another.. yet another record increase in their funding. "
But this is the 2nd successive year there's been a deficit after record funding - and that deficit is rising.
WARE: Does it surprise you¿ that the books are not going to balance this year?
DREDGE: Unfortunately, yes, it amazes me, not just surprises me.
WARE: Ministers have talked down the size of the problem.
In December they insisted they'd stop the deficit from rising to £620m - the half year forecast by NHS managers.
HEWITT:We will get the net overall deficit back towards 250m by the end of this year
WARE: By March the Health Secretary wasn't so optimistic.
HEWITT: "the £200million end year deficit that I told the House last year I hoped we would be able to achieve looks increasingly unlikely."
APPLEBY: "..that actually has gone up, so we're looking at close on 800 million net deficit ..."
WARE: Behind the scenes at the Department of Health, there was something akin to panic, according to those close to officials.
MAYNARD: I think there was a feeling of crisis. In fact I'd go stronger, I'd say there is a feeling that because we've got an 800 million deficit, panic is in the NHS, mostly in the Department of Health. The NHS is just sitting there saying okay, we're still going to have to treat patients. If you come in through the door we're going to treat you. If you go to see your GP you're still going to be treated."
HEWITT: when you're managing an organisation the size of the 33rd biggest economy in the world, it is very difficult to model and predict with absolutely exactitude every aspect of every thing that you're doing.
WARE: Just as it's jolly hard for Chief Executives of the hospitals running big budgets presumably
HEWITT: This is like trying to land a jumbo jet on a postage stamp every year, and I think it is a real tribute¿
WARE: Well you're about to skid off the runway frankly, I mean you're heading for a billion pounds deficit¿..
HEWITT: I think it is a real tribute to the quality of the management and the clinical leadership we've got across the service that actually the service has been in financial balance for so many years and the majority of organisations are at balance or indeed in surplus.
WARE: The deficit wasn't the Department's only major miscalculation.
Welcome to the Tariff.
The Tariff is the list of prices set by the Department which Hospitals can charge for over 500 different medical procedures.
Without the Tariff, Hospitals simply cannot plan their year ahead.
When the department published it in January, hospitals were aghast at how little they were going to be paid.
MAYNARD: The response of the NHS was this is going to cause enormous disturbance because there were many gainers and losers and whenever you have gainers and losers, the gainers go off to the pub and the losers scream like blue murder, so people were saying I'm going to sack 500 people here, you can tell Mrs Hewitt that we won't hit the 18 week target
WARE: This revolt was led by those hospitals in the vanguard of the NHS revolution: the government's flagship Foundation Trusts.
They complained the tariff was far too low to pay for the huge rise in costs - and would push the NHS even deeper into debt.
DREDGE: I mean I've heard figures of 7, 10, 15 million pounds.
WARE: Per hospital.
DREDGE: Deficit, per¿ for average sized hospitals just on the basis of the change in the tariff.
WARE: So translate that across the country, I mean extrapolate that across the country, are we talking hundreds of millions ?? ¿.
DREDGE: You're talking of, I guess, you know.. on top of my head, 6, 7, hundred million pounds, yes.
WARE: In February the department was forced into a humiliating retreat - and had to tear up the tarrif.
That same day local health chiefs were sent what's been described as a "we know where you live letter" on behalf of the NHS's most senior official Sir Nigel Crisp.
Hospitals and clinics were ordered to freeze all spending that was not absolutely necessary.
"There can be no exceptions" the executives were warned. Sir Nigel was taking a "direct and personal interest" in each and every one of them.
Two weeks later Sir Nigel resigned. He said he was saddened by "by the difficulties¿ and financial problems" the health service was "grappling with."
This week a new financial year begins.
Never has there been so much instability in the system.
The Department has only just reissued its Tariff to hospital leaving them little time to plan how to get themselves out of debt.
Patients will feel the effect as some hospitals lay off staff and slow the pace of working.
Like the year that's ending, debt, pay and other rising costs will swallow most of next year's extra billions, leaving little to further cut waiting lists.
WARE: How many marks out of ten would you give the government for value.. for giving the taxpayer value for money?
MAYNARD: I think the improvements in the service have been quite considerable and therefore you can almost etch up to 6 out of 10 for them. But it's the frustration of not getting that other four that's not using those resources more productively.
WARE: In two years time, the government's present commitment to record growth in NHS spending comes to an end.
WARE: Will this chance come round again?
MAYNARD: Highly unlikely in our lifetime
WARE: All the experts that we've spoken to give you ten out of ten for initiative, ¿finding enormous sums of money, but they don't give you high marks at all for value for money.
HEWITT: Every patient survey that we do says patients are seeing the improvements. They rate their own GPs, their hospitals, their accident and emergency as better than it used to be, getting better still. So the patients are certainly seeing the improvements. I think¿ I know that we've got more to do to show the public that we're not only giving them better and faster care, but that we are delivering the best possible value for that extra money that we have asked them to pay to put into the NHS."
WARE: Building up the NHS has been a bruising business for ministers and managers.
But now the government will have to manage down the public's expectations of what all their taxes are actually delivering.
Labour has been banking on the NHS as a trump card at the next election.
But the way they've played it means it might not prove to be quite the ace they thought.